Gauteng MEC for Economic Development, Environment, Agriculture and Rural Development, Lebogang Maile’s remarks at the Progressive Professional Forum Seminar, Midrand
Gauteng Premier, Hon. David Makhura,
MEC for Roads and Transport, Hon. Ismael Vadi,
Tshwane MMC for Economic Development, Hon Subesh Pillay,
Secretary of the Black Business Council, Xolani Qubeka,
President of the Progressive Professional Forum, Mr Jimmy Manyi,
Leaders of the Progressive Professionals Forum and the Black Business Council at all levels,
Guests and colleagues.
Thank you Programme Director.
For the purposes of this dialogue I wish to focus my input on the meaning of Gauteng City Region as a geographic, institutional but importantly an economic entity. I think this framework is useful as it provides a cogent basis from which to understand the programme for Transformation, Modernisation and Re- Industrialisation as articulated by the Premier in various platforms.
Historically and in terms of policy discourse, the most commonly used understanding or definition of a City Region is that it consists of two or more historically and politically separate cities, with no hierarchical ranking, in reasonable proximity and with functional interconnection. In addition, a city region is often distinguished by three characteristics.
The first characteristic is of a spatial nature, meaning that it has one or more central metropolitan areas and surrounding hinterlands. Secondly, a city region is characterized by intensification of economic activity for enhanced comparative advantage in response to heightened economic competition.
Lastly, a distinct social trait of a city region is increased urbanization, high levels of immigration, diversity, and prone high inequality levels.
Programme Director,
The ten-pillar programme to transform, modernize and re-industrialise provides a practical and thorough programmatic direction for building and consolidating the GCR. It is a blue print for turning Gauteng into an integrated City Region defined by social cohesion and economic inclusion and gives us a broad rubric toward a seamlessly integrated city-region that is also the leading economy in Africa.
In other words, Programme Director, the TMR as a programme of government is essentially about giving practical expression to the vision of a globally competitive City Region.
Along with the ten pillars of the TMR, we are working towards building a Gauteng that is anchored around the following core economic, social and political principles:
To start with, we approach development in a coordinated and holistic way with the aim of addressing the key economic and social challenges within the city region.
The overall strategic thrust is to build Gauteng in which economic activities of different parts of the province – what we call the Development Corridors – complement each other in consolidating Gauteng as an economic hub of Africa with a compelling international economic presence.
This perspective is a radical departure from the notion that treats different regions of the province as competing entities.
The City Region approach is premised on the motto ‘cooperate internally and compete better externally’. We are primarily concerned with promoting synergies and using the network of economic activity in within Gauteng as a platform for competitive advantage and economic growth.
The GCR is also about how we organize ourselves to better address the threats and challenges that come with a globalized economy and to collectively take advantage of economic opportunities across the globe.
Because the economic footprints of the city region go beyond the administrative borders of Gauteng, it is also expected that the economic opportunities presented by the City Region will also have a ripple effect on “outer” or “edge” cities that together with Gauteng make up what is South Africa’s industrial heartland. Rustenburg, Sasolburg, Witbank and Secunda are among some of the cities counted on this list.
Programme Director, these principles must also be understood within the broad framework that informs the ANC’s perspective on economic transformation which spells out the following:
1. Creating of decent work as the most effective weapon against poverty and inequality;
2. Accelerating inclusive economic growth;
3. Promoting equity; transforming structures of production and ownership;
4. Reversing apartheid settlement patterns
5. And supporting participation for cooperatives and small businesses.
We are all aware that Gauteng has the highest concentration of modern infrastructure and advanced economic activity in the country and the SADC region. This also explains the increased dominance of the tertiary sector in our economy. In this way, Gauteng mirrors the development of most city regions globally, even in the developing world.
This reality presents its own challenges. To begin with, the canvas on which we are sculpting our vision is far from perfect. Our unemployment, poverty and inequality rates are far too high and unequal spatial development, lack of social cohesion and high levels of crime and deviance are issues that require our urgent attention.
Moreover, there are vast economic disparities between the different Development Corridors that constitute the GCR. We can actually argue that there exists a core versus periphery divide with Gauteng, with Sedibeng and the West Rand largely occupying the periphery and Johannesburg, Tshwane and Ekurhuleni occupying the economic core.
The reason we say this is informed by the fact that almost all research indicates that poverty and unemployment are relatively higher in these areas compared to the rest of the province. The West Rand and Sedibeng are currently growing at 1% and 0,7% respectively, a factor explained by the global economic crisis, declining of mining activity and the lack of economic diversification.
To change this state of affairs, we envisage a bigger role for agri-business, renewable energy and tourism in the West Rand and are also working towards maximising the role of Vaal River as Sedibeng’s strategic tourism asset for tourism and using agriculture to position the region an Agro-tropolis. There are also enormous possibilities for green industries and renewable energy in both these areas.
Programme Director, dedicated focus on our declining manufacturing is important in turning the fortunes of the City Region’s industries around and creating decent jobs.
The massive rollout of the public transport infrastructure also provides opportunities to revive local manufacturing through the assembling of buses, trains and locomotives and sourcing goods and services from South African producers, especially small businesses and township enterprises.
Allow me to list a number projects that will be undertaken together with state owned enterprises and the private sector:
1. PRASA’s projected investment of R123 billion in new rolling stock over a period of 20 years will create an estimated 30 000 jobs.
2. Transnet’s investment in the inland ports of Tambo Springs and Sentrarand, which will also have a major impact in revitalising the economy of Ekurhuleni.
3. Major investments that are linked to the Aerotropolis, Lanseria Airport in Johannesburg and the Wonderboom Airport right here in Tshwane
4. The Gauteng ICT Park which will go a long way towards building an IT manufacturing industry within Gauteng
5. Growing Tshwane’s current automotive portfolio by not only supporting automotive manufacturers but also increasing the stake of local, township based component manufacturers as suppliers to the auto industry.
A focus to understanding the needs of different sectors of the economy and how these could propel the transformation, modernisation and re-industrialisation of Gauteng will allow us to unlock their potential and facilitate the creation of decent jobs.
We are finalising studies into the automotive manufacturing, construction, real estate, mineral beneficiation, agro-processing, pharmaceuticals, ICT, finance sectors of the economy. Not only are we looking at interventions for growth but we are also scrutinizing the ownership patterns in order to create more space for black and township entrepreneurs in these industries.
Another area of focus is the revitalisation of our township economies. We are already making strides in this regard and some of the concrete interventions include:
1. Increased allocation for township enterprise development by our municipalities with Johannesburg, Ekurhuleni making substantial financial commitments to support township businesses
2. The Provincial Government has allocated 30% over the next five years as procurement spend for township businesses
3. We are already in advanced discussions with the private sector about the establishment of a Township Economy Partnership Fund to mobilise resources for investment in township enterprises and cooperatives.
4. There are also promising engagements with established businesses to integrate township based entrepreneurs in agro-processing and automotive value chains.
5. The enterprise hubs in various townships will also address challenges related to economic infrastructure and operational space for township businesses
Energy security is also are high on our list of priorities. The City Region has adopted an elaborate energy security plan that will see all spheres of government playing a role in mitigating this challenge. Key interventions include:
1. Adding 1200 megawatts of electricity by increasing generation capacity of the current coal-fired power stations in Tshwane (Rooiwal and Pretoria West Power) and Joburg (Kelvin Station).
2. Installing roof top solar panels for all our government buildings.
3. Retrofitting all our coal fired boilers with natural gas.
4. Introducing Tri-generation to produce electricity for our hospitals
5. Increasing the scale of our waste to energy programme
6. Rolling out LED lights for all government buildings. We are also investigating the possibilities of producing these in the province.
Programme Director,
Finally, the ten-pillar programme also enjoins us to take the lead in Africa’s industrial revolution. Currently, only 3% of the world merchandise exports are from Africa and as much as 50% of the continent’s exports are processed elsewhere to get their extra value. Except for a few countries like South Africa, the manufacturing sector contributes less than 10% to the economies of most countries in our continent.
An industrial revolution, led by Africans, would mean that our continent would cease to be a mere exporter of unfinished goods and a market for commodities that originate outside its borders. Our contribution to altering these circumstances will be in the form of the Gauteng Trade and Investment Strategy. We want to see more trade between Gauteng and its counterparts in the continent and we seek to form part of a movement to ensure that our continent develops a productive economy that can sustain its people in the future.
This in a nutshell, ladies and gentlemen, is our perspective on transformation, modernisation and re-industrialisation.
Thank you for listening!
